Week 6 - Misrepresentation Flashcards
Define misrepresentation
A false statement of fact, made by one party before or at the time of the contract, which induces the other party to enter the contract
What is the first element for an actionable misrepresentation?
The statement must be one of fact, not mere opinion
What is the second element for an actionable misrepresentation?
The statement must induce the party to enter into the contract
What is the third element for an actionable misrepresentation?
Silence cannot be misrepresentation
What are the exceptions to silence not being considered as misrepresentation?
- relationships of good faith
- contract of utmost good faith, such as insurance
- if silence or half-truth is misleading
- failure to disclose a change in circumstances
For fraudulent misrepresentation…
Claimant must prove claim beyond reasonable doubt
For negligent misrepresentation…
Claimant must prove misrepresentation was made
For negligent misrepresentation, who is the burden of proof on and what do they need to prove?
The burden of proof is on the defendant to prove ON THE BALANCE OF PROBABILITIES that they had reasonable grounds to believe it was true
What are the two outcomes of an accusation of negligent misrepresentation?
Defendant succeeds - wholly innocent misrepresentation
Defendant fails - negligent misrepresentation
What are the three types of misrepresentation?
- fraudulent
- negligent
- wholly innocent
Define fraudulent misrepresentation
Either made knowing it was untrue, not believing it was true, or not caring if it was true
Define negligent misrepresentation
Defined by Misrepresentation Act 1967
- made honestly believing it to be true, but without reasonable grounds for such a belief
Why are clients always better to go with negligent misrepresentation?
1) easier to accuse defendant
2) defendant has to prove their innocent, instead of claimant proving their crime
